Plain simple

As expected AIG was up to no good with derivatives and faulty accounting practices without marking to market. Voila, the market sold off and right off the start it was below S1(627). Shorts were initiated and closed out by EOD. Tomorrow's numbers are 624, 618 and 607 and more sellings are expected.

good luck

2c

Pivot is king...

Recalled we said position for shorts yesterday. Today, it dropped at open because of lousy GDP. But no sweats, as soon as it fell below 635 pivot, shorts were initiated and they were closed out at
about s1 (631). The rest of the day was left to the amateurs. Since it closed below s1 today, more sellings are expected tomorrow. Follow the pivots and you will never get hurt. Unlike others, we do not have to straddle anything nor do we have to play market both ways for we know what we are doing with powerful statistical analyses that are into the futures. Remember we have not lost one single trade so far. Today is the last day chart is posted. From now on use your imagination. Tomorrow's numbers are 634, 631 and 627. You can see this is an NR7. However, since we are sitting on the confluence of averages, it can still break out either side. The bias though is down.

2c

Are'nt we having fun..

As expected yesterday's surpassing of r1 by the close triggered off a sell-off in the morning. This was also because of the bad durable goods numbers. Then B2 Bomber Ben spoke and became Helicopter Ben again. While he spoke, OEX pivot 633 held and you can see from the chart, longs were fired off. They were closed at 638ish level, having three tries to break it without success. This is also the all important area. Tomorrow's numbers are 639, 635 and 631. It is at the overbought area, although there should theorectically more room to go but scaling out of longs and position for shorts are in order.

2c

Another good day...

It was prudent to close out the longs yesterday for any overshoot past r1 will almost always trigger a retracement in the morning albeit strong trend. This morning we had bad PPI and HD reports. However, the market is on an up trend and pivot 628 held. Longs were initiated and the news from IBM just fueled the up move. Again, as you can see in the chart, the longs were closed out when
r1 (635ish) was reached . Not to be greedy, there is sometimes overshoot by the late comers and you can see they were the losers by the close. Tomorrow's numbers are 640, 633 and 628. This 635 area is an important area, and one would not be surprised to see some retracement before going up again especially when it is overbought. The market is attempting to stage an intermediate up trend, if it can close above 635. The chart is to show how pivot numbers can be used to trade profitably. Real time posting of trades is not the objective of this blog for there is no need to prove anything. Recognitions and glories can be left to other posters. Realisation of monetary rewards way surpasses any other recognitions.

2c

Beauty

Two trades were done successfully today. As soon as the market reached OEX r1 (627-628) a short was in order and was closed out at pivot 620. Why? because it held. Longs were initiated as it rose beyond 620 and closed out by the end of the day. Why? because it has gone past r1 (628) and beyond. Now that it has broken out of the symmetrical triangle to the up side more rise could be seen. Tomorrow's numbers are 635, 628 and 623. If it is a bullish trend under normal circumstances you would see it ride on r1 till it drops. But this is a skittish abnormal market and tomorrow we have PPI, Consumer confidence etc. and it is better to get what the market gives you and not be too greedy. As a side bar, this blog experienced the first spam on the weekend and in order to keep this blog clean, comments will be moderated from now on and you can still put in comments by validation and remain anonymous if you wish. Freedom after all has a price.

2c

Weekend update...diary of an option trader

In order to clarify how profits can be made from the market via options the following chart helps to explain the diary of last four trades. Notice trades were fired off at r1 and s1 levels and pivots are used to gauge the very short term trends. You can see the pivots are still sloping down that means further down trend is expected until proven otherwise. Longs are closed out at r1 or higher and shorts were closed out at s1 or lower.

Here's the summary of approximately how the last four trades were done using one OEX contract as an example.

Feb 19, Mar OEX 630 put, 18-22, $400 profit
Feb 20, Mar OEX 620 Call, 16-21, $500 profit
Feb 21, Mar OEX 630 put, 18-22, $400 profit
Feb 22, Mar OEX 620 put, 16-20, $400 profit

Now you can imagine, the effect of mulitplier if you have multiple contracts. You can also visiualise how the next day's plan is. This perhaps will clarify why just numbers are mentioned day after day and this is not so boring after all and is actually very exciting if you have money in your pocket everyday.

2c

Day trading for survival?

Right after it could not surpass 623 pivot, short was in order and a contination of yesterday's sell off until it hit S1 614 and below. If you followed the numbers and the plan, you would not get slaughtered by the AMBAC bail out news by the close. If you are day trading, the important times are 10 am and 2 pm. whereby market normally turns. Ya, it was massive short coverings. Today, as anticipated, it fell out of the symmetric triangle signaled by the double WR7 but what happened at the close distorted it and now it is back inside the triangle. However, it has not changed the sentiment one iota. Next week there will be a flurry of economic data such as PPI, Housing, Consumer sentiment etc and all can be assumed to be bad. Except of course, the truth of the Ambac bail out news. If anything else, it will provide a higher ground to short from, there is unfinished business on the down side. Monday's numbers are 628, 620 and 615.

Have a good weekend.

2c

Philly Fed did it...

what a horrible number and is quite significant too. Yes, it is a confirmed recession and the market sold off just about having signs of recovery. Well let's look at the damage today. Again, it spanned r1(630) to s1(619) and closed below s1. You've two WR7s side by side and if we consider the move from Feb8 is an up move, we got exhaustion here. Watch the lower channel very carefully, if broken we start wave 5. Right now it is not looking good. Except for RIMM, AAPL and GOOG got turned back from reversing. Perhaps it is only a delay and will see. OIH and POT are retreating. This makes sense if we have a recession. Tomorrow's numbers are 627, 623 and 614.

2c

Volatility rules

The bad CPI brought the DOW down 100 points but the Fed minutes brought it back up 200 point. The options guy loves it but you have to day trade it to get the benefits. In a nut shell, the Feds are saying they will lower inflation expectation to accomodate the economy. That means more rate cuts. As mentioned before, the bias is still down but the picture is changing. Today, OEX spanned s1 (618) to r1(629). Tomorrow's numbers are 630, 623 and 619. 618 was tested multiple times and if held again to close around 630-631, the chances are breakout to the upside. The NASDAQ 3 horsemen are turning up especially RIMM. Commodities related trades such as POT, and OIH are already into intermediate up trend.

2c

Sideways...

It is not that easy to work off a confirmed sell signal. The DOW traversed 200 points and eventually fell back down to reality. Ok we've got $100 oil and where do we go from here. Tomorrow's numbers are 629, 625 and 618. CPI tomorrow and see if it will spark one way or the other. The bias is still down, although the selling sentiment subsided a lot. Well best is to stand aside and let it break out of the triangle before doing anything....

2c

Weekend Update

An argument for symmetric triangle to the downside.....

2c

Hold shorts

If it were not for President's day Monday the market would have been worst. Anyways, it closed below pivot 626 and Tuesday's numbers are 626, 622 and 621. Again it starts narrowing and is an NR7. The bias is break out to the downside. The sellings are not finished yet. As anticipated the three Nasdaq horsemen rolled over. AAPL nt target 120, RIMM nt target 91 and GOOG nt target 506 and OIH nt target 162. Well what about OEX nt target? The thinking is 610 to be revisited, 1320 in SPX. Have a great long weekend folks.



2c

B2 Bomber Ben

He is no longer Helicopter Ben. As he spoke today, the market fell. So the market did not break above the all important 631. As soon as it fell below pivot 630 you should have an idea what to do. Ya, this is a pattern violation (up pattern). Tomorrow's numbers are 629, 626 and 618. 618ish being the forecasted number and would probably act as the magnet for the market to gravitate to. Whenever there is a 20 point difference between the closing price and forecast number, it will fall back in place. That really means another DOW 100 points down expected. 618 also being the bottom channel and if that is broken then we are in real trouble, for wave 5 down will start. BB Ben mentioned "deteriorates" twice and that the credit problem is a long dark tunnel with no light in sight. We are falling into recession. When the market comes to the realisation it is not going to be pretty. As a side bar, a look at the technicals of the Nasdaq 3 horsemen (RIMM, APPL, GOOG) and OIH, they are about to fall over.

Good luck

2c

Sitting right at EMA

631 it is. Tomrrow's numbers are 635, 630 and 627. 635 is Fib 618 from Feb4, Fib 50 from Jan10 and approx. Fib 38.2 from Dec27. This is an important confluence number to watch. The forecast is in approx 2 days's time, if it cannot break above 635ish, watch out below....

2c

All on board, ship shape....

nothing much to say if everything is as predicted. Actually this is scary. Buyers came out from hiding. It is such a nice chart today so classic that one wants to frame it. This is a gratifying day for all the channelling, Fibonaccing, EWaving etc etc all works together. Now tomorrow's numbers are 628, 623 and 618. One expects the up trend to continue for the next few days. When it hits the all important exponential moving average of 630ish it is testing time again. Live or die. If broken heads up to 650. In any case 650 is expected to be top before the next wave 5 down.

Have fun

2c

On track

It spanned r1 619 to s1 610 today. Tomorrow's numbers are 621, 615 and 612. Not much buying sentiment today. Hopefully tomorrow more buyers will come out. Today's little up tick was partially due to Hugo Chevas. Near term target is still 635ish and not looking too much above that.

2c

Wave count

To count the waves starting from Oct, the followings are important turn dates.
Oct11,
Nov27,
Dec10,
Feb05 2008.

As you can see, the retracements follow Fib ratios closely. Bear in mind the 618 sometimes overshoots. Therfore we are now in wave 4 and if wave2=wave4 then target is 661 else a conservative take is 38 Fib ratio to 650. After that a wave5 down follows.
2c

Market about to rally...

Monday or Tuesday latest from cycle forecast. A conservative target will be 635ish and ideally should be the upper channel around 650ish. Monday's numbers are 619, 615 and 610. On more reflection, the last up and down legs did not qualify for an ABC corrective wave because of the severity of the last leg down. If that is the case, then the last leg is the 2wave and we could be surprise to see a 3wave up this time. Any EW guy out there?

2c

612 held for now

The market is obviously looking for a bottom here. With volatility so high, it spanned between r1 622 and s1 612. Although not confirmed yet, with Fib ratio at 61% retrace, closing above pivot 618 and at lower boundary of channel, there is a high possibility that it will bounce from here to the upper channel. Tomorrow's numbers are 624, 617 and 611.

2c

The all important 612

Well today the pivot 625 acted as resistance and the market failed miserably. Tomorrow's numbers are 622, 618 and 612. If 612 fails it will be a landslide. Just couldn't understand the Fed. They cut interest rate deeply to save the market, but one or two bad apples became talking heads today to warn against inflation and the market slided. They are not in sync at least they should have kept their mouths shut until the interest rate cut does it's magic. What is the point of having emergency 75 bps cut, if it is only going to delay the slide for a few days.....

2c

Market just overreacted to backward looking news

The retrace was anticipated but not to this extend. However, now the channel is established and until 612 is violated to the down side and tomorrow's numbers are 632, 625 and 612. It is still treated as ABC corrective waves until otherwise.

2c

This is the anticipated pull back

but it should be shallow and quick. It could not hold above pivot 644 today. Tomorrow's numbers are 644, 641 and 635. The market should be higher in the next little while.

2c

Weekend Update

Here it is, just use channelling and CCI techniques you can see the the buy and sell points, noting the daily pivot numbers of course. It does not matter bear or bull market, as long as the up channel is not violated remain long. Don't believe in retest the lows, it is garbage. The retest has already been done, where it breaks out and is completed. You can see the trend is approx one to two months and this is no stress trading. You only trade 5/6 times in the past six months. Don't even look at the market. Too much information is not good and you won't be able to pull the trigger. Also forget about picking tops and bottoms. Nobody in the world can do that. Just think about getting 70% of each trend and your money would be doubled and tripled. Good luck folks.

2c

Yes it can do it

Like that little train going uphill. The weekly numbers are 655, 637 and 625. The daily numbers for Monday are 650, 644 and 641. Today it closed at 646. Can you imagine the picture? 641 or 644 are buy points and yes 660 is achievable. There may be a pullback sometime next week but it will not be below 635ish if uptrend is to be continued.

2c